West Law Report

Aircraft technical problem is not ‘extraordinary’

Posted in Court of Justice of the European Communities (ECJ) (cas, Times Law Report by mrkooenglish on February 19, 2009

From The TimesFebruary 16, 2009

Aircraft technical problem is not ‘extraordinary’
Wallentin-Hermann v Alitalia – Linee Aeree Italiane SpA in the Court of Justice of the European Communities

Court of Justice of the European Communities
Published February 16, 2009
Wallentin-Hermann v Alitalia – Linee Aeree Italiane SpA
Case C-549/07
Before K. Lenaerts, President of Chamber and Judges T. von Danwitz, E. Juhász, G. Arestis and J. Malenovský
Advocate-General E. Sharpston
(No opinion delivered)
Judgment December 22, 2008

A technical problem in an aircraft which led to the cancellation of a flight did not constitute a sufficiently extraordinary circumstance to justify the carrier refusing to pay compensation to passengers unless the problem stemmed from events which, by their nature or origin, were not inherent in the normal exercise of the carrier’s activity and were beyond its actual control.

The Fourth Chamber of the Court of Justice of the European Communities so ruled, inter alia, when giving a preliminary ruling under article 234 EC, pursuant to a reference by the Handelsgericht, Wien, Austria, on questions of interpretation of Regulation (EC) No 261/2004 of the European Parliament and of the Council of February 11, 2004, establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91 (OJ 2004 L46/1).

The claimant booked three flights with the defendant from Vienna to Brindisi via Rome, the first flight being scheduled to depart from Vienna at 6.45am and the third to arrive in Brindisi at 10.35am the same day.

Five minutes before the aircraft was due to leave Vienna, the passengers were informed that the flight had been cancelled. The claimant was transferred to another flight to Rome, but only arrived there after the departure of the original connecting flight to Brindisi, and consequently did not arrive in Brindisi until 2.15pm.

The cancellation of the Vienna-Rome flight was due to a turbine failure in an engine which had been discovered during a check the day before and had been notified to the defendant at 1.00am on the day of the scheduled flight.

The claimant sought €250 compensation from the defendant under articles 5(1) and 7(1) of Regulation 261/2004, and in the course of proceedings brought by her after her request was refused, the European Court was asked to rule on the question, inter alia, whether a technical defect in an aeroplane, in particular damage to the engine, came within “extraordinary circumstances” in article 5(3).

Article 5 of the Regulation provides: “(1) In case of cancellation of a flight, the passengers concerned shall … (c) have the right to compensation by the operating air carrier in accordance with article 7, unless: … (iii) they are informed of the cancellation less than seven days before the scheduled time of departure and are offered re-routing, allowing them to … reach their final destination less than two hours after the scheduled time of arrival…

“(3) An operating air carrier shall not be obliged to pay compensation in accordance with article 7, if it can prove that the cancellation is caused by extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken…”

Article 7 provides: “(1) Where reference is made to this article, passengers shall receive compensation amounting to: (a) €250 for all flights of 1,500 kilometres or less…”

Recital 14 in the preamble states: “As under the [Montreal Convention for the Unification of Certain Rules for International Carriage by Air of May 28, 1999, signed and approved for the European Community by Council Decision 2001/539/EC of April 5, 2001 (OJ 2001 L194/38)], obligations on operating air carriers should be limited or excluded in cases where an event has been caused by extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken.

“Such circumstances may, in particular, occur in cases of political instability, meteorological conditions incompatible with the operation of the flight concerned, security risks, unexpected flight safety shortcomings and strikes that affect the operation of an operating air carrier.”

In its judgment, the Fourth Chamber of the Court of Justice held:

“Extraordinary circumstances” was not defined in the 2004 Regulation, but the phrase was to be interpreted narrowly since article 5(3) constituted a derogation from the principle, indicated in recitals 1 and 2 of the preamble, of protection of consumers, in as much as cancellation of flights caused serious inconvenience to passengers.

It was apparent from recital 14 in the preamble that the legislative intention was not that the events mentioned there, the list of which was only indicative, themselves constituted extraordinary circumstances, but only that they could produce such circumstances.

It followed that all the circumstances surrounding such events were not necessarily grounds of exemption from the obligation to pay compensation.

Although the list included “unexpected flight safety shortcomings” and although a technical problem in an aircraft could be among such shortcomings, the fact remained that the circumstances surrounding such an event could be characterised as extraordinary within article 5(3) only if they related to an event which was not inherent in the normal exercise of the activity of the air carrier concerned and was beyond the actual control of that carrier on account of its nature or origin.

Air carriers were inevitably confronted with technical problems as a matter of course in the exercise of their activity, and it was in order to avoid such problems and to take precautions against incidents compromising flight safety that aircraft were subject to regular checks which were particularly strict, and were part and parcel of the standard operating conditions of air transport undertakings.

The resolution of a technical problem caused by failure to maintain an aircraft was therefore to be regarded as inherent in the normal exercise of an air carrier’s activity, and consequently, technical problems which came to light during maintenance of aircraft, or on account of failure to carry out such maintenance, could not constitute, in themselves, “extraordinary circumstances”.

However, it could not be ruled out that technical problems were covered by those exceptional circumstances to the extent that they stemmed from events which were not inherent in the normal exercise of the activity of the carrier and were beyond its actual control, for example, if it was revealed by the aircraft manufacturer or a competent authority that aircraft already in service were affected by a hidden manufacturing defect which impinged on flight safety, or where damage to the aircraft was caused by acts of sabotage or terrorism.

For reasons stated by it, the court held that the Montreal Convention, article 19 of which provided for exemption of a carrier from liability for damage occasioned by delay “if it proves that it and its servants and agents took all measures that could reasonably be required to avoid the damage or that it was impossible for it or them to take such measures”, was not determinative of the interpretation of the grounds of exemption under article 5(3) of the Regulation.

On those and further grounds stated by it the Court ruled:

1 Article 5(3) of Regulation 261/2004 was to be interpreted as meaning that a technical problem in an aircraft which led to the cancellation of a flight was not covered by the concept of “extraordinary circumstances” within the meaning of that provision, unless that problem stemmed from events which, by their nature or origin, were not inherent in the normal exercise of the activity of the air carrier concerned and were beyond its actual control.

The Montreal Convention was not decisive for the interpretation of the grounds of exemption under article 5(3) of Regulation 261/2004.

2 The frequency of the technical problems experienced by an air carrier was not in itself a factor from which the presence or absence of “extraordinary circumstances” within the meaning of article 5(3) could be concluded.

3 The fact that an air carrier had complied with the minimum rules on maintenance of an aircraft could not in itself suffice to establish that the carrier had taken “all reasonable measures” within the meaning of article 5(3) and, therefore, to relieve the carrier of its obligation to pay compensation under articles 5(1)(c) and 7(1).

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One EU court cannot stop case in another

Posted in Court of Justice of the European Communities (ECJ) (cas, Times Law Report by mrkooenglish on February 19, 2009

From The TimesFebruary 13, 2009

One EU court cannot stop case in another
Court of Justice of the European Communities
Published February 13, 2009
Allianz SpA and Another v West Tankers Inc
Case C-185/07
Before V. Skouris, President and Judges P. Jann, C. W. A. Timmermans, A. Rosas, K. Lenaerts, A. Ó Caoimh, P. Kuris, E. Juhász, G. Arestis, A. Borg Barthet, J. Klucka, E. Levits and L. Bay Larsen Advocate General J. Kokott
(Opinion September 4, 2008)
Judgment February 10, 2009

It was not open to a court in one European Union member state to order a party in a case before it to discontinue proceedings begun by that party in another member state on the ground that the parties had agreed to refer any disputes between them to arbitration in the first state.

The Grand Chamber of the Court of Justice of the European Communities so held when delivering a preliminary ruling on a reference by the House of Lords under articles 68 and 234 EC.

A vessel owned by West Tankers Inc and chartered by Erg Petroli SpA, under a charter-party governed by English law and containing a clause providing for arbitration in London, collided with and caused damage to a jetty in Syracuse, Italy, owned by Erg.

On a claim by Erg, Allianz SpA and Generali Assicurazioni Generali SpA, the insurers, paid compensation to Erg and, under their right of subrogation to Erg’s claims, brought proceedings against West Tankers before the Tribunale di Siracusa, Italy.

West Tankers raised an objection of lack of jurisdiction, on the basis of the existence of the arbitration agreement.

West Tankers also brought proceedings in England for a declaration that the dispute between itself and the insurers was to be settled by arbitration pursuant to the arbitration agreement, and for an injunction restraining the insurers from pursuing any proceedings other than arbitration and requiring them to discontinue the proceedings in Italy.

The High Court granted the antisuit injunction sought, and the insurers appealed to the House of Lords, arguing that the granting of the injunction was contrary to Council Regulation (EC) No 44/2001 of December 22, 2000, on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (OJ 2001 L12/1).

The House of Lords took the view that the principle, decided in Case C-116/02 Erich Gasser GmbH v MISAT Srl ([2005] 1 QB 1) and Case C-159/02 Turner v Grovit([2005] 1 AC 1), that an injunction restraining a party from commencing or continuing proceedings in a court of a member state was not compatible with the system established by Regulation No 44/2001, could not be extended to arbitration, which was completely excluded from the scope of the regulation by article 1(2)(d).

The House of Lords referred a question on that issue to the European Court.

In its judgment the Grand Chamber of the Court of Justice held: Proceedings which might appear to be excluded from the scope of Regulation No 44/2001 could nevertheless have consequences which undermined its effectiveness, and that was so if such proceedings prevented a court of another member state from exercising the jurisdiction conferred on it by the regulation.

If, because of the subject matter of the dispute, ie the nature of the rights to be protected in proceedings, such as a claim for damages, those proceedings came within the scope of Regulation No 44/2001, a preliminary issue concerning the applicability of an arbitration agreement, including in particular its validity, also came within its scope of application.

It followed that the objection of lack of jurisdiction raised by West Tankers before the Tribunale di Siracusa on the basis of the existence of an arbitration agreement came within the scope of Regulation No 44/2001 and that it was exclusively for that court to rule on that objection and on its own jurisdiction, pursuant to articles 1(2)(d) and 5(3) of the regulation.

The use of an antisuit injunction to prevent a court of a member state, which normally had jurisdiction to resolve a dispute under article 5(3), from ruling, in accordance with article 1(2)(d), on the very applicability of the regulation to the dispute brought before it, necessarily amounted to stripping that court of the power to rule on its own jurisdiction under the regulation.

Such an injunction was contrary to the general principle that every court seised itself determined, under the rules applicable to it, whether it had jurisdiction to resolve the dispute before it: see Gasser, paragraphs 48 and 49.

On those and further grounds stated by it the Court ruled: It was incompatible with Regulation No 44/2001 for a court of a member state to make an order to restrain a person from commencing or continuing proceedings before the courts of another member state on the ground that such proceedings would be contrary to an arbitration agreement.

Disability discrimination ban applies to carers too

Posted in Court of Justice of the European Communities (ECJ) (cas, Times Law Report by mrkooenglish on August 1, 2008

From The TimesJuly 29, 2008

Disability discrimination ban applies to carers too
Coleman v Attridge Law (a Firm) and Another Case C-303/06 in the Court of Justice of the European Communities

Court of Justice of the European Communities

Published July 29, 2008

Coleman v Attridge Law (a Firm) and Another Case C-303/06

Before V. Skouris, President and Judges P. Jann, C. W. A. Timmermans, A. Rosas, K. Lenaerts, A. Tizzano, M. Ilešic, J. Klucka, A. Ó Caoimh, T. von Danwitz and A. Arabadjiev Advocate-General M. Poiares Maduro (Opinion January 31, 2008)

Judgment July 17, 2008

The prohibition of direct discrimination against and harassment of disabled people in employment, provided for in the Community disability directive, was not limited to employees who were themselves disabled but extended to unequal treatment and harassment of a non-disabled employee for reasons connected with the disability of his child.

The Grand Chamber of the Court of Justice of the European Communities so held on a reference for a preliminary ruling under article 234 EC by the London South Employment Tribunal.

The claimant, Ms Sharon Coleman, a legal secretary working for the defendants, Attridge Law, a firm of solicitors in London, and Mr Steve Law, a partner in that firm, gave birth to a son who suffered from apnoeic attacks and congenital laryngomalacia and bronchomalacia and needed special care. The claimant was his primary carer.

After ceasing her employment, the claimant brought a claim of unfair constructive dismissal against the defendants, alleging breaches of the Disability Discrimination Act 1995, which, by virtue of amendments made by the Disability Discrimination Act 1995 (Amendment) Regulations (SI 2003 No 1673), transposed into United Kingdom law Council Directive 2000/78/EC of November 27, 2000, establishing a general framework for equal treatment in employment and occupation (OJ 2000 L303/16).

In the proceedings before the employment tribunal, the reference to the European Court was made on the basis of a presumed set of facts, not yet established, which included that on the claimant’s return from maternity leave, she had been treated in a way that parents of non-disabled children would not have been, in that she had, inter alia, not been allowed to return to her existing job and had less flexibility of working hours, and had been subjected to abusive and insulting comments about her and her child.

Article 1 of the directive provides: “The purpose of this Directive is to lay down a general framework for combating discrimination on the grounds of … disability … as regards employment and occupation, with a view to putting into effect in the member states the principle of equal treatment.”

Article 2 provides: “(1) For the purposes of this Directive, the ‘principle of equal treatment’ shall mean that there shall be no direct or indirect discrimination whatsoever on any of the grounds referred to in article 1.

“(2) For the purposes of paragraph (1): (a) direct discrimination shall be taken to occur where one person is treated less favourably than another is, has been or would be treated in a comparable situation…

“(3) Harassment shall be deemed to be a form of discrimination within the meaning of paragraph (1), when unwanted conduct related to any of the grounds referred to in article 1 takes place with the purpose or effect of violating the dignity of a person and of creating an intimidating, hostile, degrading, humiliating or offensive environment…”

Article 3 provides: “(1) … this Directive shall apply to all persons … in relation to: … (c) employment and working conditions…”

In its judgment the Grand Chamber of the Court of Justice held:

It did not follow from articles 1, 2(1), 2(2)(a) or 3(1)(c) of Directive 2000/78 that the principle of equal treatment which it was designed to safeguard was limited to people who themselves had a disability within the meaning of the directive.

On the contrary, the purpose of the directive, as regarded employment and occupation, was to combat all forms of discrimination on the ground of disability.

The principle of equal treatment enshrined in the directive in that area applied not to a particular category of person but by reference to Where it was established that an employee in a situation such as that in the present case suffered direct discrimination on grounds of disability, an interpretation of Directive 2000/78 limiting its application only to people who were themselves disabled was liable to deprive the directive of an important element of its effectiveness and to reduce the protection which it was intended to guarantee.

Since article 2(3) deemed harassment to be a form of discrimination within article 2(1), the directive was similarly not limited to the prohibition of harassment of people who were themselves disabled.

On those and further grounds, the Court ruled:

1 Directive 2000/78, and, in particular, articles 1 and 2(1) and (2)(a) thereof, were to be interpreted as meaning that the prohibition of direct discrimination laid down by those provisions was not limited only to people who were themselves disabled.

Where an employer treated an employee who was not himself disabled less favourably than another employee was, had been or would be treated in a comparable situation, and it was established that the less favourable treatment of that employee was based on the disability of his child, whose care was provided primarily by that employee, such treatment was contrary to the prohibition of direct discrimination laid down by article 2(2)(a).

2 The directive, and in particular articles 1 and 2(1) and (3), were to be interpreted as meaning that the prohibition of harassment laid down by those provisions was not limited only to people who were themselves disabled.

Where it was established that the unwanted conduct amounting to harassment which was suffered by an employee who was not himself disabled was related to the disability of his child, whose care was provided primarily by that employee, such conduct was contrary to the prohibition of harassment laid down by article 2(3).

Race bias finding without identifiable victim

From The TimesJuly 16, 2008

Race bias finding without identifiable victim
Court of Justice of the European Communities
Published July 16, 2008
Centrum voor gelijkheid van kansen en voor racismbestrijding v Firma Feryn
NV Case C-54/07
Before C. W. A. Timmermans, President of Chamber and Judges L. Bay Larsen, K. Schiemann, J. Makarczyk and J.-C. Bonichot Advocate General M. Poiares Maduro
(Opinion March 12, 2008)
Judgment July 10, 2008

Public statements by an employer that it would not recruit employees of a certain racial or ethnic origin constituted direct discrimination in respect of recruitment, within the Community race discrimination directive, even though there was no identifiable complainant contending that he had been the victim of discrimination.

The Second Chamber of the Court of Justice of the European Communities so held, inter alia, on a reference for a preliminary ruling under article 234 EC by the Arbeidshof te Brussel (Brussels Labour Court), Belgium.

In statements made in newspapers and on television, a director of the defendant company, which made and installed up-and-over and sectional doors, stated that fitters that the company wished to recruit could not be immigrants as customers would be reluctant to give them access to their premises.

The claimant, the Centre for Equal Opportunities and Combating Racism, applied for a declaration that the defendant was infringing the Belgian law transposing Council Directive 2000/43/EC of June 29, 2000 implementing the principle of equal treatment between persons irrespective of racial or ethnic origin (OJ 2000 L180/22), and an order requiring it to end its discriminatory recruitment policy.

The court dismissed the application on the ground that there was no proof or presumption that any person had applied for a job and not been employed as a result of his ethnic origin. On appeal issues were referred to the European Court.

In its judgment the Second Chamber held: Offering observations, the United Kingdom and Ireland argued that it was not possible for there to be direct discrimination where there had simply been public statements by an employer on its recruitment policy, and there was no identifiable complainant contending that he had been the victim of discrimination.

It was true that article 2(2)(a) of Directive 2000/43 defined direct discrimination as a situation where “one person is treated less favourably than another”.

However, the aim of the Directive, as stated in recital 8 of its preamble, was to foster conditions for a socially inclusive labour market. For that purpose, article 3(1)(a) stated that the Directive covered, inter alia, selection criteria and recruitment conditions.

That objective would be hard to achieve if the scope of the Directive were to be limited only to cases where an unsuccessful candidate for a post brought proceedings.

The fact that an employer had declared publicly that it would not recruit employees of a certain ethnic or racial origin was clearly likely strongly to dissuade certain candidates from submitting their candidature and, accordingly, to hinder their access to the labour market, and hence constituted direct discrimination.

The existence of such direct discrimination was not dependent on the identification of a complainant who claimed to have been the victim.

With regard to article 8, public statements by an employer that, under its recruitment policy, it would not recruit any employees of a certain ethnic or racial origin, could constitute facts such as to give rise to a presumption of a discriminatory recruitment policy.

The employer could thereafter adduce evidence that it had not breached the principle of equal treatment, which it could do, inter alia, by showing that the actual recruitment practice of the undertaking did not correspond to those statements.

The sanctions provided for in article 15 could include a finding of discrimination by the court or the administrative authority, in conjunction with an adequate level of publicity, the cost of which was to be borne by the defendant.

They could also take the form of a prohibitory injunction, in accordance with the rules of national law, ordering the employer to cease the discriminatory practice, and, where appropriate, a fine.

They could, moreover, take the form of the award of damages to the body bringing the proceedings.

For those and further reasons the Court ruled:

1 The fact that an employer stated publicly that it would not recruit employees of a certain ethnic or racial origin constituted direct discrimination in respect of recruitment within the meaning of article 2(2)(a) of Directive 2000/43, such statements being likely strongly to dissuade certain candidates from submitting their candidature and, accordingly, to hinder their access to the labour market.

2 Public statements by which an employer let it be known that under its recruitment policy it would not recruit any employees of a certain ethnic or racial origin were sufficient for a presumption of the existence of a recruitment policy which was directly discriminatory within the meaning of article 8(1) of Directive 2000/43.

It was then for that employer to prove that there was no breach of the principle of equal treatment. It could do so by showing that the undertaking’s actual recruitment practice did not correspond to those statements.

It was for the national court to verify that the facts alleged were established and to assess the sufficiency of the evidence submitted in support of the employer’s contentions that it had not breached the principle of equal treatment.

3 Article 15 of Directive 2000/43 required that rules on sanctions applicable to breaches of national provisions adopted in order to transpose the Directive had to be effective, proportionate and dissuasive, even where there was no identifiable victim.

Awaiting European outcome

From The TimesJune 27, 2008

Awaiting European outcome
Court of Appeal
Published June 27, 2008
Johns v Solent SD Ltd

Where there was a reasonable chance that the Court of Justice of the European Communities might decide a case pending before it so as to give a plaintiff a good claim in the English courts, the sensible answer was to stay the hearing of the claimant’s case so that it would not be snuffed out before the European Court decision became known.

The Court of Appeal (Lord Justice Pill, Lord Justice Keene and Lady Justice Smith) so held on June 12, 2008, dismissing an appeal by the employer, Solent SD Ltd, from a decision of Mr Justice Nelson in the Employment Appeal Tribunal staying a claim by Anna Johns for age discrimination related to her compulsory retirement at age 65. The judge imposed the stay to await the outcome in the European Court of R (National Council for Ageing) v Secretary of State for Trade and Industry, known as the Heyday case.

LADY JUSTICE SMITH said there was no dispute that the claim would fail if decided on current English law. The tribunal chairman had purported to determine the prospects of the Heyday case on the basis of the Advocate-General’s opinion in Palacios de la Villa v Cortefiel Servicios SA (Case C-411/05) ([2008] All ER (C) 249). But the European Court had come to different conclusions from the Advocate-General in that case.

Mr Justice Nelson had concluded that Heyday did have reasonable prospects of success. In the circumstances, the only sensible answer was that there should be a stay in the instant proceedings.

Competitors’ trademarks can be used in comparative advertising

From The TimesJune 17, 2008

Competitors’ trademarks can be used in comparative advertising
Court of Justice of the European Communities

Published June 17, 2008

O2 Holdings Ltd and Another v Hutchison 3G UK Ltd

Case C-533/06

Before P. Jann, President of Chamber and Judges A. Tizzano, A. Borg Barthet, M. Ilesic and E. Levits Advocate General P. Mengozzi

(Opinion January 31, 2008) Judgment June 12, 2008

The proprietor of a trademark was not entitled to prevent the use by a competitor of a sign identical or similar to his mark in a comparative advertisement, provided, inter alia, that there was no risk of confusion on the part of the public between the proprietor and the competitor or between their respective goods or services.

The First Chamber of the Court of Justice of the European Communities so held, inter alia, on a reference for a preliminary ruling by the Court of Appeal.

The claimants, O2 Holdings Ltd and O2 UK Ltd, providers of mobile telephone services, used bubble images to advertise their services and were the proprietors of two marks registered in the UK for telecommunications apparatus and services, each consisting of a static picture of a bubble.

The defendant, another provider of mobile telephone services, marketed under the sign “3”, offered, inter alia, a pay-as-you-go service known as “Threepay”.

In television advertisements for Threepay, the defendant used the name “O2” in conjunction with bubble imagery, followed by “3” and “Threeway” imagery, and stated that its services were cheaper than those of the claimants’ in a specific way.

In trademark infringement proceedings brought by the claimants, it was accepted for the purpose of those proceedings that the price comparison in the advertisement was true and that the advertisement was not on the whole misleading and in particular did not suggest any form of trade connection between the claimants and the defendant.

The High Court dismissed the claim on the ground that although the use of the bubble images in the advertisement came within article 5(1)(b) of First Council Directive 89/104/EEC of December 21, 1988, to approximate the laws of the member states relating to trade marks (OJ 1989 L40/1), the defendant had a defence deriving from Council Directive 84/450/EEC of September 10, 1984, concerning misleading and comparative advertising (OJ 1984 L250/17), as amended by Directive 97/55/EC of the European Parliament and of the Council of October 6, 1997 (OJ 1997 L290/180).

On the claimants’ appeal, the Court of Appeal referred under article 234, issues raised to the European Court of Justice at Luxembourg Court for a preliminary ruling.

The First Chamber of the Court of Justice held as follows:

It was necessary to clarify the relationship between Directives 89/104 and 84/450.

Under article 5(1) and (2) of Directive 89/104, the registered trademark proprietor had exclusive rights entitling him, under certain conditions, to prevent all third parties not having his consent from using in the course of trade any sign which was identical with, or similar to, his trademark, and under article 5(3)(d), he could prevent the use of such a sign in advertising.

However, it was apparent from recitals 2 to 6 in the preamble to Directive 97/55 that the Community legislature wished to promote comparative advertising, in the interests of stimulating competition and informing consumers, and recitals 13 to 15 recognised that, in the context of comparative advertising, the right conferred by a trademark had to be limited to a certain extent.

It would be held, in order to reconcile the protection of registered marks and the use of comparative advertising, that a trademark proprietor was not entitled to prevent the use, by a third party, of a sign identical with, or similar to, his mark, in a comparative advertisement which satisfied all the conditions laid down in article 3a(1) of Directive 84/450.

However, the same interpretation was to be given to the word “confusion” in article 5(1)(b) of Directive 89/104 and article 3a(1)(d) of Directive 84/450, and it was to be pointed out that where the condition in article 5(1)(b) relating to confusion was met, it was not possible for the condition in article 3a(1)(d) to be satisfied.

It was apparent from article 3a(1)(d) that comparative advertising was not permitted if there was a likelihood of confusion between the advertiser and a competitor or between the advertisers trademarks, goods or services and those of a competitor.

For article 5(1)(b) to operate in favour of a trademark proprietor, four conditions had to be satisfied: the use had to (i) be in the course of trade, (ii) be without the consent of the proprietor, (iii) be in respect of identical or similar goods or services, and (iv) affect or be liable to affect the essential function of the trademark, which was to guarantee to consumers the origin of the goods or services, by reason of a likelihood of confusion on the part of the public: see, for example, Arsenal Football Club v Reed (Case C-206/01) (The Times November 18, 2002; and May 22, 2003; \ Ch 454; \ ECR I-10273).

The first three conditions were satisfied in the present case.

However, on the referring court’s own findings, the use by the defendant, in the advertisement in question, of bubble images similar to the claimants’ trade marks did not give rise to a likelihood of confusion on the part of consumers: the advertisement, as a whole, was not misleading and, in particular, did not suggest that there was any form of commercial link between the claimants and the defendant.

On those and other grounds the European Court of Justice ruled:

1 Article 5(1) and (2) of Directive 89/104 and article 3a(1) of Directive 84/450 were to be interpreted to the effect that the proprietor of a registered trademark was not entitled to prevent the use by a third party of a sign identical with, or similar to, his mark, in a comparative advertisement which satisfied all the conditions, laid down in article 3a(1) of Directive 84/450, under which comparative advertising was permitted.

However, where the conditions required in article 5(1)(b) of Directive 89/104 to prevent the use of a sign identical with, or similar to, a registered trade mark were met, a comparative advertisement in which that sign was used could not satisfy the condition, laid down in article 3a(1)(d) of Directive 84/450, under which comparative advertising was permitted.

2 Article 5(1)(b) of Directive 89/104 was to be interpreted as meaning that the proprietor of a registered trademark was not entitled to prevent the use by a third party, in a comparative advertisement, of a sign similar to that mark in relation to goods or services identical with, or similar to, those for which that mark was registered where such use did not give rise to a likelihood of confusion on the part of the public, and that was so irrespective of whether or not the comparative advertisement satisfied all the conditions laid down in article 3a of Directive 84/450 under which comparative advertising was permitted.